Gisley Investments Pty Ltd v Williams
[2013] QDC 123
•21 May 2013.
DISTRICT COURT OF QUEENSLAND
CITATION:
Gisley Investments Pty Ltd v Williams [2013] QDC 123
PARTIES:
GISLEY INVESTMENTS PTY LTD
(Plaintiff)
v
MICHAEL LLEWELLYN WILLIAMS
(Defendant)
FILE NO/S:
BD 2543/2010
DIVISION:
PROCEEDING:
Trial
ORIGINATING COURT:
District Court, Brisbane
DELIVERED ON:
21 May 2013.
DELIVERED AT:
Brisbane
HEARING DATES:
2, 3 April 2012; 6, 7, 8 November 2012
JUDGE:
McGill SC DCJ
ORDER:
Judgment that the defendant pay the plaintiff $123,949.43, including interest of $19,702.64.
CATCHWORDS:
BUILDING AND ENGINEERING CONTRACTS – Remuneration – project manager – percentage of construction cost plus percentage of savings over quoted prices – determination of relevant amounts.
Building and Construction Industries Payments Act 2004 s 100(3)(b).
COUNSEL:
T A Houghton for the plaintiff (April)
B Gilbert (Director) for the plaintiff (November)
The defendant appeared in person
SOLICITORS:
Quinn & Scattini Lawyers for the plaintiff (April)
In November the plaintiff was not represented
The defendant was not represented
The plaintiff wanted an industrial building constructed at Loganholme on a parcel of land, and advertised for a project manager.[1] The defendant held a contractor’s licence and has been working in the building industry all of his life, and in particular has experience in constructing tilt panels, concrete wall units which are cast on site and then put in a vertical position so that they function as wall units.[2] Mr Gilbert, who ran the plaintiff, and the defendant met and discussed the plans for the project, and terms for the defendant to manage it.[3] Subsequently the plaintiff sent the defendant an email setting out proposed terms for the management of the project: Exhibit 3. It is common ground that that email was accepted by the defendant, and sets out the contract between the parties. The defendant did manage the construction of the building, although ultimately disputes arose between them and the plaintiff says that the defendant left the work site before everything was properly finished: p 71.
[1]Gilbert p 70; Exhibit 2.
[2]Williams p 32; They are cast flat, then lifted and put into position as wall units. Their casting and erection are shown in the photographs in Exhibit 21. They can also be constructed off site; I have seen such units being brought by truck to a building site.
[3]Williams p 33; Gilbert p 70.
The defendant subsequently made a claim under the Building and Construction Industries Payments Act 2004. That claim was disputed by the plaintiff, and the matter went to adjudication, as a result of which an adjudicator ordered the plaintiff to pay the defendant $127,313.50: Exhibit 4. That sum has been paid (p 36); under the Act the claim which is before me is independent of that decision and payment, except that it is taken into account as a payment made in respect of the project when working out the implications of my findings. The findings and conclusions of the adjudicator are not binding in this proceeding, and are I suspect irrelevant and inadmissible.
The parties are in dispute as to the amount payable by the plaintiff to the defendant under the contract. Because of the adjudication decision the plaintiff says it has paid much more than was payable to the defendant under the contract, so in substance the plaintiff’s claim is to recover the overpayment. The defendant disputes the amount said by the plaintiff to be payable under the contract. The plaintiff claims in the alternative a restitutionary claim for the same amount; in my opinion in circumstances such as this the plaintiff is entitled to recover any overpayment by a common money count for money had and received to the plaintiff’s use, but in any case it is clear that if there has been an overpayment as a result of an adjudicator’s decision the amount of the overpayment is recoverable.[4] There were other matters initially raised in the Statement of Claim but they have been abandoned. The issue therefore is, what amount was really payable by the plaintiff to the defendant under the contract in the events that have happened.
[4]Building and Construction Industries Payments Act 2004 s 100(3)(b).
The defendant also claimed that he did additional work, particularly in relation to the construction of mezzanine floors in the building, which was not covered by the original agreement. This he claimed was not work done as a project manager under the contract, but was work which was done essentially as a subcontractor. The defendant alleged that he had not been paid for this work, and claims that he is entitled to remuneration outside that contract on a quantum meruit. In reply the plaintiff alleged that construction of the mezzanine floors was included in the total construction costs of the building, and remuneration for it wsa covered by the contract Exhibit 3. This was really a separate issue from the question of what amount was payable under the agreement between the parties, at least as the claim was advanced by the defendant.
The contract
The email was in the following terms:
“Dear Mike
My proposal for the supervision of Henry St is as follows
To gain quotes for various trades, to oversee all works for this job including helping with the joinery and subcontracting of ground works concreting including laying of steel and co-ordination of earth moving machines and concreting personnel at the agreed price
To also control Work place safety to meet regulation
My offer for this work is to be 5% of the construction price and 30% of any saving that you may obtain by ways of a cheaper quote or employing trades directly to save over a quoted price for a similar works
I expect these works to be started in between three and four weeks time.
If this proposal meets with your approval please respond and we can get things moving
Regards Andrew”
After the trial started in April last year it became apparent there was an issue, which had not been properly raised on the pleadings, as to the correct interpretation of this document. It also seemed to me that the defendant wanted to raise a number of other issues which had not been properly pleaded in his then current pleading. As a result the trial had to be adjourned, but the parties said they were in a position to argue the question of the true interpretation of the contract, and I decided that point as a preliminary point in advance of the trial on 3 April 2012.
I decided that, for reasons which I then gave, the true interpretation of the contract between the parties as to the remuneration of the defendant under it was:
“The remuneration of the defendant is 5% of the actual construction costs of the project to the plaintiff, together with 30% of any saving which is to be measured in one of two ways if either is applicable:
(a) if the defendant obtained a lower quote than a quote obtained by the plaintiff for the same work, any saving in the actual construction cost to the plaintiff for the work covered by the quotes being less than the amount of the quote obtained by the plaintiff;
(b) if a quote was obtained for particular work, and if that work was then done by the defendant employing trades directly, that is to say as if he were acting as the subcontractor, any saving in the actual construction cost to the plaintiff for the work covered by the quote being less than the amount of the quote.”
It will be apparent therefore that under the contract there are three issues to be determined: What was the actual construction cost of the project to the plaintiff? Were there any parts of the work where the defendant obtained a lower quote than the quote obtained by the plaintiff, thus saving the construction costs of the plaintiff, and if so by how much? Was any work done by the defendant employing trades directly and thereby saved construction costs of the plaintiff compared with a quote which had been obtained (by the plaintiff or the defendant) for the same work, and if so how much was saved?
The defendant was not represented at all at the trial; for most of the trial neither party was represented. Whether the defendant was capable of performing properly the process of supervising the construction of a building I am in no position to judge, but he was certainly not capable of running a trial properly. He required a good deal of assistance in formulating anything like a proper pleading, appeared to have no idea how to set about proving the case he was seeking to advance, and to have no idea of the proper function of cross-examination.[5] The defendant appeared at times to have difficulty in focussing on the particular point which required attention at that time.[6]
[5]See for example p 49; day 3 p 2,3. He kept wanting to make statements instead of asking questions, but when it came to his case he initially did not seem to grasp the need to give evidence himself: pp 27-31.
[6]See for example p 35 line 51; p 48; p 49.
It also became apparent that the process that he had used in identifying the relevant costs associated with particular parts of the project for the purpose of determining whether he had achieved savings over quoted costs had not been as thorough as the performance by the plaintiff of the equivalent exercise. The defendant’s cross‑examination on the difference between his lists and the plaintiff’s lists was by no means comprehensive, and it was frequently the case that the defendant was unable to provide any convincing explanation for the absence from his list of invoices included in the plaintiff’s list. Although I have not accepted the plaintiff’s lists unquestioningly, where specific differences were identified and examined in any detail it normally appeared that something which ought to have been included had been left out of the defendant’s list. Bearing this in mind, where there were differences between the lists which were not examined during the evidence, or explained in any detail, I am generally prepared to accept that the plaintiff’s list is accurate, unless there is something inherently implausible about the particular entry.
I do not think that there are many issues as to credibility in this matter. The plaintiff struck me as disorganised, but not particularly as dishonest. I think he was fairly frank about his position in relation to the dispute,[7] and was obviously unhappy about the outcome of the project from his point of view. Mr and Mrs Gilbert also seemed to me to be essentially honest witnesses, but to have fairly strong feelings about this matter which may mean that in some respects their evidence is not reliable, perhaps because they are so focussed on their particular point of view. Generally I am not prepared to accept the evidence of the defendant as to the content of conversations with Mr Gilbert where they were denied by him; otherwise, any specific findings are on the basis explained below.
[7]For example, about not returning a vehicle which belonged to the plaintiff because he had not been paid, even after he had the benefit of the adjudication: p 92.
First issue: quantification of construction price
Mr Gilbert’s wife worked as office manager for the plaintiff, since July 2006: p 16. She was responsible for paying invoices relating to the job, and she prepared a spreadsheet in which she recorded all of those invoices: Exhibit 5. Copies of the invoices on which this document was based had all been made available to the defendant. Counsel for the plaintiff offered to tender them, but it seemed to me that, so long as the defendant had access to all of them, it was sufficient to see what was challenged in cross-examination, and if necessary the original documents could be put in evidence in response. The defendant did not at any time seek the tender of all of the invoices, and I accept Mrs Gilbert’s evidence that the information in the spreadsheet reflected the invoices that she had.[8]
[8]The documentation on which some entries in the spreadsheet were based was tendered, and supported those entries.
The defendant kept no equivalent record of the costs of the project, and in the circumstances I am prepared to accept that Exhibit 5 is a record of the costs of the project, except to the extent that particular entries have been shown to be inappropriate. When Exhibit 5 was tendered it had some hand written amendments. A series of payments of about $870 each to the Logan City Council were deleted, because these were for rates on the land, which is not a building cost: p 17. The balance of the payments to the Council, which related to application fees, should also have come off,[9] so the whole of the $35,563.33 paid to the Council should be deducted. The plaintiff also deleted a cost of $39.99 for a carton of beer for the workers at the time; it is not necessary for me to decide whether that could reasonably have been included in the cost of the building.
[9]Mrs Gilbert p 65.
A revised version of Exhibit 5 became Exhibit 13. There are few changes from Exhibit 5, and the changes were not examined in the evidence. The items crossed out from Exhibit 5 were still in Exhibit 13. In five cases the total paid to a particular payee changed. The first was the payments to M Williams, where the total shown in Exhibit 13 correctly adds the payments listed. Two invoices have been taken out of the list of payments to Steellink, and the new total is correct for the invoices now listed; it appears to me that two payments to Hymix were included in this list in Exhibit 5 As well, a note has been put in showing the apportionment of two Steellink invoices between panels and concrete work, which has resulted in the apportioned amounts being added into the totals shown for Statewide Survey and The White Ant Company, which are above and below the entry for Steellink. The totals for these companies in Exhibit 5 were correct. Finally the same five invoices are listed for Tilt Lift, but the first is no longer added in to get the total shown on Exhibit 13. As discussed below, this was an invoice the defendant said had been paid twice, and this omission adds support to that, so I accept it should come off, and the Exhibit 13 figure is correct. But the total for Statewide Survey should be adjusted to $4,755.68, and the total for The White Ant Company to $792, so that the total in Exhibit 13, $1,538,752.62, should be reduced to $1,531,987.62.
Exhibit 13 included nine payments made to the defendant as remuneration totalling $67,000 during 2009, but did not include the further payment made to the defendant following the adjudication decision. It seems to me that that approach is incorrect.[10] In my opinion the natural interpretation of the email, consistent with the decision on the preliminary issue, is that the 5% is to be worked out on the basis of the actual construction costs of the project without regard to the amount payable to the defendant. Ordinarily when one is working out a percentage of the value of something, one does not take into account the increase in the amount generated by the addition of the percentage.[11] Accordingly the amount payable to the defendant should not I think be included in the calculation of 5%. The figure in Ex 5 is therefore too high by $67,000, the payments to the defendant which are included in the total figure: p 17.
[10]The defendant appeared to agree with this: p 37, but see p 38.
[11]Just as an example, GST on an item is 10% of the cost or value of the item exclusive of GST, or one eleventh of the cost or value of an item inclusive of GST.
One entry in the schedule was the sum of $40,000 for administration fees, which covered the internal costs of the plaintiff associated with the construction of the project. It might have been arguable that these costs were not part of the “construction price” to the plaintiff of the project, but the plaintiff has included them in the schedule, which is to the advantage of the defendant, and in the circumstances I am content to treat them as properly included.
There were also some other issues raised during cross-examination of Mrs Gilbert. She said that one invoice from Logan Steel, for $16,250, had been mistakenly entered twice in the spreadsheet: p 65. There are two such entries in Exhibit 13, which looks unlikely, and she was not challenged on this, so I accept the deduction should be made. As well, there was a sum included to King and Co, property consultants, of $23,134.50, which was not a construction cost, so it should also be deducted. It appears that the spreadsheet originally included all of the plaintiff’s costs associated with this project, but that is a different concept from the “construction price” of the building, which is what is relevant for the purposes of the calculation. No other matters were raised by the defendant.
I therefore find that the construction price is arrived at by deducting from the adjusted total in Exhibit 13, $1,531,987.62, the following:
(a) Logan City Council rates and fees $35,563.33
(b) Payments to defendant $67,000.00
(c) Logan Steel duplicate invoice $16,250.00
(d) King and Co Property Consultants $23,134.50
(e) Carton of beer $39.99
TOTAL $141,987.82
Mrs Gilbert said she removed GST from the balance: p 67. There is nothing in the email Exhibit 3 to indicate whether the “construction price” is net of or including GST. In my opinion, prima facie “price” includes GST, since it provides for 5% of what the plaintiff has to pay, which includes GST. As well, any ambiguity in the email should be resolved against its author.[12] So I will not deduct GST.
[12]Maye v Colonial Mutual Life Assurance Society Ltd (1924) 35 CLR 14 at 26; Wesoky v Village Cinemas International Pty Ltd [2001] FCA 32 at [47].
In all the circumstances therefore I find that the amount which represented the construction price to the plaintiff for the purposes of the contract between the parties was $1,389,999.80. The defendant is therefore entitled to 5% of this, an amount of $69,499.99.
Second issue: Savings from lower quotes
The plaintiff provided particulars of the matters in respect of which he alleged that there was an additional 30% savings payable, and replacement particulars in respect of these matters were delivered on 6 November 2012. There was also a document setting out the basis upon which each saving was calculated. These documents cover both cases where it is alleged the defendant obtained a cheaper quote than the plaintiff had, and cases where it is alleged that the defendant did the work more cheaply than a quote for the work which had been obtained. In relation to the former, the matters relied on were:
1. Roller shutter doors;
2. Aluminium window screens;
3. Painting;
4. Fencing;
5. Air conditioning;
6. Supply of concrete;
7. Structural steel for the roof;
8. Roof sheeting.
The defendant said that there were a number of cases where he obtained quotes and discussed them with Mr Gilbert, and in that discussion he was told that Mr Gilbert’s quote was for a higher amount, sometimes nominating a particular amount: pp 67 - 73. Unfortunately the defendant’s evidence about this was quite vague, and at no time was he able to produce a written quote or a copy of a written quote, which Mr Gilbert had obtained, which was for a higher figure than the quote obtained by the defendant and actually used by the plaintiff. Mr Gilbert in his evidence said that in respect of these particular things either the quotes were much the same or the quote that he obtained was marginally lower, but he was prepared to go along with the defendant’s choice of supplier.[13]
[13]Gilbert p 82-4. He said he did not get a quote for fencing (p 84), road base or greenboard cladding: p 84. See also Mrs Gilbert p 64 re painting, fencing.
There was no admission in oral evidence that the plaintiff had obtained a higher quote at a particular sum, or even higher by some particular or approximate amount, so there is no documentary evidence or admission in support of this part of the claim. On the whole I am not sufficiently confident of the reliability of the defendant to accept a claim which is based simply on the defendant’s recollection of a statement which he says was made to him by Mr Gilbert at the time as to the difference between the quote obtained by the defendant and a quote the plaintiff had obtained. Unless there is better evidence than that, I am not persuaded that the claim has been made out.
There are three items which must be dealt with specifically. The first was the supply of concrete. The plaintiff did not admit that the plaintiff’s quote for this was higher than the quote from Hymix (Exhibit 20), but in any event it was submitted for the plaintiff that, in so far as there were savings on the supply of concrete, these were already taken into account because the concrete costs were included in the panel costs and in the concreting work costs, where ultimately the defendant was recovering savings, and, in so far as savings had been achieved because the purchase price of the concrete was lower than it would otherwise have been, 30 per cent of that saving accrued to the defendant in this way.
In my opinion that argument is correct. If the plaintiff had purchased concrete at a higher price from some other supplier, its actual costs of doing the panel work and the other concrete work would have been higher, and hence the amount of any saving when compared with the relevant comparison quote would have been lower. It follows that, because of the fact that the concrete that was purchased was used for things which were being covered by aspects of the work where the defendant was entitled to 30 per cent of the savings anyway, this benefit was already accruing to the defendant, and to allow an additional 30 per cent in respect of a lower quote for the supply of concrete would mean he would be getting 30 per cent of the savings under the agreement twice, which was not the way that the agreement operated. Accordingly even if the defendant had been able to show that there was a saving in relation to the supply of concrete, and in the absence of any documentation as to the existence and quantum of a higher quote obtained by the plaintiff that claim is not made out, the claim would not have been available anyway.
The second was in relation to the roof sheeting. The defendant obtained a quote from Burleigh Roofing dated 30 January 2009 for $62,000 plus GST, $68,200.[14] The difficulty here is that, although Mr Gilbert’s recollection was that he did obtain the quote himself for the roof sheeting, he said he was unable to locate this: p 83. The defendant said that he thought he had never seen the copy of the plaintiff’s roof sheeting quote: p 72. Mr Gilbert’s recollection was that the quotes obtained by the plaintiff were overall less than the quotes obtained by the defendant: p 84. Ultimately, the situation is that again the defendant is not able to make out this claim on the balance of probabilities.
[14]The work was done by Burleigh Roofing, at a total cost, according to the plaintiff, of $77,803: Exhibit 11.
Finally, there was one part of the work where there were comparable quotes, the existence of which was not disputed, for the structural steel for the roof. The plaintiff obtained a quote from KDT Fabrications in December 2007, for $205,200 plus GST, a total of $225,720: Exhibit 26. The defendant obtained a quote from Logan Steel dated 30 January 2009 for $191,000 plus GST, which comes to $210,100: Exhibit 28. The plaintiff then obtained a further quote from KDT, dated 4 February 2009, for only $191,700 plus GST: Exhibit 19. On the face of it there was a small saving over the quote obtained by the plaintiff. Logan Steel was used. Although the amount ultimately paid to them came to $240,401.36, this included the sum of $3,850 for shop drawings associated with the tilt panels: Exhibit 13.
A cheaper price in the amount of $770 was secured as a result of the defendant’s obtaining a lower quote. The plaintiff did not seek to make a case that the additional amount in fact paid to Logan Steel over the amount quoted was for things included in the comparison quote. Apart from the shop drawings, there may have been other additional work. Accordingly, this saving is one to which the savings clause applies, and the defendant was entitled to the benefit of 30 per cent of the saving, $231.00.
Third issue: Work undertaken by defendant
The defendant’s particulars identified a number of areas where it was alleged that work was undertaken by the defendant acting as a subcontractor more cheaply than a quote which had been obtained. Two of these were the greenboard cladding and the laying of the road base to the hardstand area, which the defendant said he completed, but which he said would have cost more if it had been subcontracted out. The difficulty with this argument is that, consistent with my ruling as to the interpretation of the contract between the parties as to the defendant’s remuneration, there has to be a quote obtained in order to activate the provision under which, if the defendant does the work at a lower cost than the amount quoted for the work, he is entitled to 30% of the savings. I do not consider that this operates in circumstances where the comparison quote is a hypothetical one, even if there were reliable evidence of what the amount of the hypothetical quote would be.[15] Because there was no actual quote obtained at the time,[16] any saving compared with a hypothetical quote is not recoverable. Given that one of the duties of the defendant under the contract (Exhibit 3) was to gain quotes for various trades, the defendant can hardly complain if there was no comparison quote in fact obtained.
[15]The defendant obtained in 2012 a quote for excavating for, supplying and laying roadbase, and associated works, of $35,585: Exhibit 22; Gilbert p 22-25.
[16]Conceded by the defendant: p 72. In November 2009 he obtained an estimate for the cost of the whole of the work, but I do not regard that as relevant: Exhibit 23.
Areas where the defendant alleges that he had completed the work and there was a comparison quote were in respect of tilt panels, concrete work and landscaping.
- Tilt panel costs
There were two quotes obtained for the supply and erection of the tilt panels, both from Panel Safe Pty Ltd. One dated 14 January 2009 was for $186,000 plus GST[17] and one dated 5 February 2009 for $175,400 plus GST: Exhibit 14. The document which was part of Exhibit A at the preliminary hearing is a two page document, but the second page does not appear to be p 2 of the quote from Panel Safe Pty Ltd 14 January 2009; it is very similar to the wording of p 2 of Exhibit 19, the quote dated 4 February 2009 for the structural steel. Although this was from a different company, both were signed by a Mr Kleinitz, so the companies were obviously related. The second page is apt for structural steel, but quite different from the second page of the second panel quote, Exhibit 14.
[17]Exhibit A, tendered on 3 April 2012, in relation to the determination of the preliminary issue. A copy of page 1 is in Exhibit 25.
Although I raised the issue at the trial, neither party was able to provide a copy of the second page of the earlier quote from Panel Safe Pty Ltd; the defendant said that he was only given the first page in the earlier proceedings: p 60. Although I have in Exhibit 14 the complete version of the later quote, what concerns me a little is the explanation for the reduced price, a not insignificant reduction of $10,600 plus GST, in circumstances where there is nothing in the first pages to explain the difference between the two quotes. It may be just that on the second occasion the person doing the quote was trying harder to be competitive, but it may also be that the second quote did not cover all of the work covered by the first quote. Be that as it may, there is no reason to doubt that the second quote Exhibit 14 is genuine and is the operative quote for the purposes of the contract between the parties.
The plaintiff put in evidence a list of the costs attributed by it to the tilt panels.[18] These came to $213,443.35. The defendant put in evidence a list of panel costs,[19] which came to $147,498.58. This was not a list maintained by him at the time, but a list put together on the basis of the copy invoices provided on disclosure, for the purposes of this proceeding. It was difficult to reconcile the items on the defendant’s list with those on the plaintiff’s list, although most of them could be identified. The plaintiff however said that there were lots of invoices left off the defendant’s list: p 9.
[18]Exhibit 8; Mrs Gilbert p 25.
[19]Exhibit 25, p 40.
A number of the entries in Exhibit 8 have after them “(Mike signed)”. Mrs Gilbert explained that this meant that the defendant had written something on the invoice and signed it attributing it to the construction of the tilt panels.[20] She also said that for some of the later invoices she telephoned him and he told her whether it was or was not over the phone, or the invoices were allocated by Mr Gilbert. There were a lot of invoices on Exhibit 8 but not in Exhibit 25 which were not referred to by the defendant in his evidence-in-chief. I took it that where he did not specifically challenge an invoice in his evidence the inclusion of the invoice on Exhibit 8 was accepted, even if that invoice could not be specifically identified in Exhibit 25.
[20]Mrs Gilbert p 29. An example is Exhibit 30: see Williams p 75-6.
The first and third invoices on the plaintiff’s list could be described as general safety and other equipment for the site, such as safety headwear and glasses, a site sign, and the provision of a toilet and site shed. Presumably these would have been required at some time, and the fact that they were provided at a time when panel construction was the only work being done on the site was simply because that was the first job done. If these were hire costs rather than purchase costs then the cost of hiring this during the time when only panel work was undertaken could be attributable to the cost of the panels. This however was the only invoice for safety equipment, and the only large invoice for Royal Wolf Trading: Exhibit 5. The Safetyquip invoice suggests that it was for purchase rather than hire: Exhibit 7. Mrs Gilbert (p 15) and the defendant (p 41) spoke of the shed being hired rather than purchased. It is not clear however what the period of hire was that was covered by this invoice or how long the only work on the site was panel work, so no part of the hire can be apportioned to the panel costs.
The next invoice on Exhibit 8 was for the hire of a generator to supply electricity to the site until such time as electricity was connected. The defendant argued that this was part of the cost of setting up the site generally, so that it was the responsibility of the plaintiff and not attributed to this particular job. It was clear from the evidence that the panel construction was the first thing undertaken on the site. If the panels had been supplied by someone else they would still have been cast on the site,[21] so there would still have been a need for electricity on the site at that time. I think this is not properly included in the panel costs.
[21]Defendant p 42, and see the reference to “casting beds” in the quote Exhibit 14.
There were a number of invoices from Ringwood & Ply in Exhibit 8, most of which were also in Exhibit 25, but there were two entries (three invoices) which were not included. This supplier provided wood for the construction of the formwork necessary for casting the panels on the site, which is obviously a cost of building the panels. The invoices were in February or early March when I suspect no other work was being done, and the defendant could provide no convincing explanation as to why the missing invoices should not have been included.[22]
[22]He conceded that one of them, for $1,279.34, should be on the list: p 44. It was for two invoices, one of which, 80279 for $396, was on Exhibit 25: see Exhibit 35.
There was an invoice from CJA Excavations not included in Exhibit 25; Mrs Gilbert said that this related to the excavation of the beds where the panels were cast and also for some work done on an access road where there were problems associated with rain damage: p 16. It seems that only panel construction was being undertaken on the site at this time, and concrete trucks would have been coming into the site for the purpose of supplying concrete for the panels in any case. It is necessary to disregard, in assessing the cost for which the tilt panels were constructed by the defendant, anything which was excluded from, or not covered by, the comparison quote. Under that quote it would have been the plaintiff’s responsibility to provide access to the site, so that costs of building and maintaining roads on the site would have been incurred by the plaintiff anyway and should not be treated as part of the cost of the panels. This cost should therefore not all be on the list; I will allow only half of this invoice. As well the invoice of 23 February from Recycling Developments for rock to maintain the access road (p 41) should not be included.
There were a number of invoices from Steellink Reinforcing Pty Ltd which appeared on both lists, but the last two such invoices on Exhibit 8, which were apportioned half to panels and half to foundations, were not on the defendant’s list, although according to the plaintiff the defendant had signed the larger invoice and thus agreed to the apportionment. The defendant said that part of this was for road maintenance, and part for loading spoil onto trucks to remove it, as well as work on the foundations, but he conceded that it could have covered drilling holes for casting the “deadmen” to prop up the panels: p 50. Under cross‑examination he conceded that he had at the time apportioned half to panels, so this large invoice is properly included: p 76 and Exhibit 31. It seems to me that the smaller invoice was for loading spoil, and was not properly included in the apportioned form in Exhibit 8. I will allow the invoice of 16 April; that of 23 April is disallowed.
There was an amount of $3,850 to Logan City Steel for the shop drawings for the panels, which was not included in Exhibit 25. The defendant said that this was included in the quote for the structural steel, but Mrs Gilbert said it was not included in the cost for the structural steel, and it does seem to me that this related to the cost of the tilt panels: p 20. There was an issue about the inclusion in Exhibit 8 of some tools, including an eight piece drill set which supposed cost $880. This was purchased on 23 March 2009 along with a couple of other items from Coventry Fasteners for a total of $912.77. The defendant said that this was not something involved in panel construction (Day 2 p 20) and that may be right. The mere fact that the defendant retained this at the end of the job, which is what the plaintiff seemed concerned about, would not make it a cost of constructing tilt panels: p 21. On the whole I do not think this invoice was properly included in the panel costs.
There were four invoices from Tilt Lift Equipment Pty Ltd in Exhibit 8, only two of which appeared in Exhibit 25 as items 17 and 18. The defendant said that 18 was an invoice paid twice (p 44), but there were different amounts paid (p 23), and bank statements in Exhibit 42 show separate payments.[23] On the other hand, according to Exhibit 8 both had the same date and invoice number, as occurred with the two entries for Tilt Lift in Exhibit 8 dated 3 March 2009, considered below. This time I do not have a copy of the smaller invoice, but the items listed in Exhibit 8 for both are very similar, and it seems very odd that there would be separate purchases of very similar items twice on the same day. I suspect that the same thing happened as with the payments of 4 march 2009, there were two documents issued, one of which superseded the other, but the plaintiff paid both of them. The plaintiff did not put the second, smaller invoice of 26 February in evidence, and in Exhibit 13 the amount of the smaller invoice was excluded from the total for Tilt Panel. On the whole I accept the defendant on this, and exclude the smaller payment of $5,110.51
[23]See also Exhibit 13, which has five entries for Tilt Lift, four attributed to the panels, but the total does not include the first.
It is not immediately obvious that the plaintiff’s list of invoices Exhibit 8 includes items expressly excluded, or not expressly covered by the allowance section of the comparison quote. I have looked at the invoices which are in Exhibit 35; none of them appears to include anything which was excluded from the quote Exhibit 14, except for two invoices of 3 March 2009 from Tilt Lift Equipment Pty Ltd, for panel chairs and decorative groove. The latter seems to be a form of decorative rebate, which was excluded from the Panel Safe quote.
These two invoices both have the same date, both refer to 54 lengths of decorative groove, plus in one, 4,000 panel chairs, and in the other, 400 panel chairs. I strongly suspect that one of the invoices was issued in error, but there was no evidence as to which was the correct one. The defendant has however included the larger invoice in Exhibit 25, which suggests that that was the correct invoice. Accordingly I will disallow the other invoice on the grounds that it is a duplication, and in any event disallow the decorative groove costing $195.48 plus GST, on the basis that that was excluded from the quote.
The defendant said that the panels were lifted into position on 17 April, so the costs for the tilt panels should have stopped on that day, but he conceded that the crane arrived to lift the panels on the 17th and finished on the 20th.[24] There would have been labour covering that period, and there would have been work done on the panels even after they had been lifted into position, for example in securing them and doing things to them which could only be done once they were upright. There was for example an invoice later for fire foam and backing foam for the panels: p 26. That particular invoice was item 25 on Exhibit 25, so it was not disputed by the defendant that it was properly included in the cost of the panels. Indeed the defendant conceded that it was not the case that all labour stopped when the panels were stood up.[25] There were a number of invoices in Exhibit 8 for the hire of a Genie Lift which was said to be for panels, from 28 April to 9 June. The defendant said the Genie Lift was used by other people later, but the plaintiff said that although it was used subsequently it had gone back in the meantime and was rehired: p 26. I am not persuaded that these amounts were not properly included in the costs of the panels.
[24]Williams p 26. See also the Panel Lift invoice in Exhibit 35.
[25]Williams p 27: see also Mrs Gilbert p 30; Gilbert p 76.
Mrs Gilbert said that on 20 April she reimbursed the defendant the sum of $660 in respect of tool hire from Kennards which she said was supposed to be in relation to the panels. Given the date of the invoice that looks likely, and the defendant was not able to provide a convincing alternative explanation. I accept that this item was properly included in the plaintiff’s list. The defendant had another invoice from Kennards on his list Exhibit 25, an amount of $131 which he said was for hiring a concrete grinder: p 28-9. Exhibit 8 includes an invoice dated 24 March 2009 for $88.90 deposit on concrete grinder, and a credit for that amount on 26 March when that was returned, but does not on its face include an invoice specifically for the hire of the grinder. There is however another invoice in Exhibit 8 dated 24 March, said to be “water pump hired to remove rainwater for panel construction”. The copy invoice in Exhibit 35 reveals that what really happened is that a deposit of $220 was paid when a grinder was hired on 23 March, and on 24 March there was a refund of $88.90 after charging $131.10 for the hire and three grinding stones. So the amount of $131.10 should have been in Exhibit 8, in place of the entries for $88.90, $220 and credit $88.90, overall a reduction in $88.90.
When the defendant went through the plaintiff’s list of invoices for the panel costs Exhibit 8 he made some further concessions about items which ought to be on the list: the Ringwood & Ply invoice of 24 February 2009 (p 44), and some labour charges such as Jason Glass on 3 and 16 April 2009, Matthew Williams on 8 April 2009 and Richard Humm on 8 April 2009: p 48-9. Initially he maintained that the invoices for labour hire dated 23 April did not relate to the panels (p 47) but after some further discussion he seemed to accept that they did: p 51. I am not at all sure about the correctness of this concession. The issue of the correct allocation of labour charges is very complicated.
The defendant maintained that some labour hire invoices on Exhibit 8 were in respect of what was actually concreting work. One difficulty with this argument is that some of these invoices did not appear on the defendant’s list of labour costs in relation to the concrete work either: Exhibit 9. He maintained that an invoice of Jason Glass of 26 March 2009 related to concreting and was on Exhibit 9 (p 45) but there is no invoice for $1,204 in Exhibit 9. He initially maintained that an invoice from Jason Glass of 16 April 2009 related to concreting but when it was pointed out that this invoice did not appear on Exhibit 9 he agreed that it could be left as part of the costs for panel work: p 49. Apart from the invoice of Jason Glass of 26 March, the last labour hire invoice on Exhibit 8 that the defendant attributed to concrete work was on 16 April, for Matthew Williams and Scott Trenoweth. But if the panels were lifted from 17 April, the foundations for them must have been built before then,[26] so some of the earlier labour must have been allocatable to them. Exhibit 25 includes labour of $795 for Scott Trenoweth, but the invoice on Exhibit 35 is dated 16 April, and is noted “footings”. An invoice for the same amount from him dated 8 April is in Exhibit 12 but was on Exhibit 8.
[26]There was in Exhibit 35 an invoice for boring holes in them on 15 April.
There are also difficulties in reconciling the amount allowed by the defendant as labour hire for concrete work and the amount allowed by the plaintiff. The defendant in Exhibit 9 had a total of $12,186 for labour, whereas the plaintiff in Exhibit 10 had a total of $18,059 for labour charges. I have not identified any duplication of labour costs between the plaintiff’s two lists. For example, invoices from Richard Humm appear on Exhibit 8 on April 3, 8, 16 and 23, and on 15 May, and then on Exhibit 10 from 28 May. Invoice from Jason Glass appear on Exhibit 8 up to 22 May, and the first entry for him on Exhibit 10 is dated 29 May. Somewhat surprisingly, there are two invoices from him dated 8 May, for different amounts, and that would be consistent with his having been working on two different projects at that time, but both were put on Exhibit 8. The defendant maintained that the second invoice related to concrete work: p 51. On the whole I accept that.
The invoices in Exhibit 12, supporting the defendant’s schedule Exhibit 9, mostly appeared in the plaintiff’s list for panel costs, Exhibit 8. Only four invoices, dated 28 May or later, are included in Exhibit 10, as items 14, 15, 26 and 27. Most labour hire invoices give no clue to the work done, but two, dated 15 May, have what look like contemporaneous entries showing that they were for panel work[27], so they should be in Exhibit 8. Concrete was being poured at least as late as 24 July, and perhaps 5 August 2009[28], but it is not clear to what extent hired labour was involved in the actual pour, as distinct from works done as preparation. Again, the plaintiff seems to have a lot of labour cost towards the end of the job, and the defendant does not seem to have enough. The four invoices of 8 April were for a time when the defendant said they were working on panels (p 49) but they might not have all been working on the panels.
[27]“Grouting under tilt panels”, “patching panels”.
[28]Exhibit 34, and see Exhibit 10 item 70; Mrs Gilbert p 44.
One important factor in relation to the costs of both the tilt panels and the concreting work was the amount spent on this work for the concrete which was used. The defendant said that all of the concrete came from Hymix Australia. The defendant said that he worked out an allowance for concrete on the basis of the volume of the panels calculated from the plans.[29] This produced a figure of $33,959.20,[30] whereas the plaintiff listed in Exhibit 8 a number of invoices from Hymix which added to much more, a total of $60,448.49. The matter is complicated by the fact that there was some dispute between the plaintiff and Hymix about what amount was payable anyway,[31] which led in June 2009 to a payment of a lump sum of $20,000. I think it highly likely that the volume of concrete actually supplied was more than the bare minimum necessary to correspond with the theoretical volume of the panels, but on the other hand this does seem a substantial discrepancy. It may be that the plaintiff was actually overcharged for concrete, but resolved the dispute with the supplier on a commercial basis. The defendant did not allow for the concrete used for “deadmen” for props for the panels once stood up (p 53), or in the casting beds: p 54.
[29]Williams day 2 p 18; and see Exhibit 25 p 2.
[30]Exhibit 25; one of the Hymix invoices was included in the list on p 1. In evidence the defendant conceded a further $2,000 for concrete for deadmen for props: p 53.
[31]Mrs Gilbert, day 3 p 89.
The defendant put in evidence[32] what he said was a printout he obtained from Hymix of all of the concrete supplied for the job, showing a total price of $101,634.20 plus GST, a total of $111,797.62, which he said corresponded with the amount allowed for concrete in his schedules Exhibit 9 and Exhibit 25, bearing in mind that in Exhibit 9 one of the concrete invoices was listed in the list for other expenses at item 24.[33] The difficulty with this argument is that the Hymix schedule Exhibit 34 starts at a delivery date of 31 March 2009, and runs through to 17 August 2009, so any deliveries made prior to 31 March would not be included. There were a number of invoices on Exhibit 8 prior to 31 March,[34] and the defendant said they began to pour concrete for casting the panels on 24 February 2009: p 7.[35] His schedule included a large number of invoices for labour cost prior to 31 March.[36]
[32]Exhibit 34: see Williams p 90.
[33]Williams day 4 p 2-3, 5, 6, 12; Exhibit 37, his calculation which produced a total close to that in Exhibit 34.
[34]These add to $36,151.94. They all appear to reflect payments the plaintiff made: Exhibit 42.
[35]I located in Exhibit 42 some copies of Hymix documents, and one original delivery docket of 24 February 2009, showing a delivery of 20m3 that day, for which an invoice of $2,948 was issued. As well, in Exhibit 35 there is an invoice of 25 February 2009 from a concreter for placing and finishing casting beds on 24 / 25 February 2009.
[36]The dates of the invoices are known to me from Exhibit 35.
The first concrete listed in Exhibit 34 is referred to in the column “Description” as “TILT/PU/32/20/80/DF”. The invoice of 31 March is one that I do have a copy of, in Exhibit 35.[37] It had the product description for the corresponding entries enlarged to “TILTUP PMP 32/20/80”. Exhibit 35 was a bundle of invoices which were allocated by the defendant as relating to the panel costs, the invoices supporting his Exhibit 25, and this invoice also appears on the plaintiff’s Exhibit 8, where it is described as “concrete for panels”.[38] There were also deliveries with the same description on 8 April and 9 April 2009, but there were no other deliveries on other days with that description in Exhibit 34. There was a different rate charged for the concrete for the panels.[39] Exhibit 34 does not set out the rate charged, or the volume delivered, so it is not possible to determine the rate for any particular delivery from that list, but it seems to me that this product description identifies concrete for the tilt panels.
[37]It was for $5,257.45, but this was based on the wrong rate for the concrete: Williams p 96, and see Exhibit 20. The plaintiff in fact paid $4,296.55, the figure in Exhibit 8. The amounts in Exhibit 34 match the amounts originally charged in the invoice.
[38]There was an invoice from Steellink Reinforcing of the same date, on both lists, for “pour panels 385m2”: Exhibit 35.
[39]Gilbert p 75; see also Williams p 9: “General mix” concrete was cheaper; Exhibit 20.
All of the other entries on Exhibit 34 have in the description column something beginning with the letters “GENE”,[40] and since deliveries were continuing after the time when Mr Williams said the tilt panels had been stood up, this must refer to concrete for other purposes. It follows from Exhibit 34 that there were deliveries of such concrete on 1, 7, 8, 9, 14, 15 and 21 April, as well as deliveries in May, June, July and August. It would appear therefore that quite a bit of concrete was being used on the project in April 2009 other than the concrete required for the panels. That is to be expected: the panels could not have been stood up unless and until there were concrete foundations available to stand them up on. The quote used for comparison, Exhibit 14, is quite detailed as to the work covered by the quote, and it does not include any provision for the construction of foundations on which to stand the panels. It follows that the construction of whatever it was that the panels were stood on should be included in the concreting work.
[40]Except for three entries with an invoice date of 27 June 2009, which have a prefix KERB, costing $1290.74, items 38 and 45 in Exhibit 10.
It follows that there are significant omissions of relevant entries for concrete from the plaintiff’s list for that work Exhibit 10. The first entry in that list for concrete is an invoice dated 6 June 2009, item 24, which is halfway down the second page of Exhibit 34. On Exhibit 8, the plaintiff’s list for the panel costs, there is an entry of $20,000 for concrete for panels dated 30 April 2009, but there is no invoice of that date on Exhibit 34, and I think this must have been a special payment in relation to the dispute between the plaintiff and Hymix about payment for concrete.[41] It is most unfortunate that I do not have a complete set of the Hymix documents, or the equivalent of Exhibit 34 in respect of the period up to 31 March 2004. Clearly Exhibit 34 does not cover all of the concrete used on the job, but it would be nice to know whether there was any and what “non-tilt panel” concrete delivered prior to 31 March. Assuming however that all of the entries on Exhibit 8 up to and including 31 March relate to the tilt panels, Exhibit 34 shows that the only tilt panel concrete delivered after that time was that delivered on 8 and 9 April 2009, for which the total price including GST from Exhibit 34 came to $6,315.10. I will allow an extra $2,000 for concrete for the deadmen, based on the defendant’s estimate. The invoice of 30 April 2009, to the extent that it is more than this, must therefore be treated as relating to concrete work, and the concrete charge for the panel costs should come down by $11,684.90.
[41]At one point it appeared that this payment also appeared in Exhibit 12 at item 34: day 4 p 9. However, this was a different payment. Item 34 was for concrete delivered on 16 June 2009: Exhibit 36, which does match entries in Exhibit 34. That was paid on 14 July, whereas the invoice in Exhibit 8, which is not in Exhibit 34, was paid on 15 June.
This would also impact on some other charges, most particularly labour. There must have been some labouring work involved in the construction of the foundations for the panels to sit on, and there would also have been costs associated with excavation of the foundations and the supply of reinforcing, and possibly plywood for formwork. A company Steellink charged for reinforcing for the foundations on 31 March according to Exhibit 10,[42] but there are no allowances for labour in Exhibit 10 until May. Some of the labour in April must have related to concreting work, that is the preparation for and construction of the foundations on which to sit the panels, and the allocation of all of this labour to panel construction in Exhibit 8 must be wrong. Indeed, some of the defendant’s concessions about labour invoices must be wrong.
[42]See the invoice in Exhibit 12.
The difficulty here that I face is that, although I am satisfied for this reason that the plaintiff’s allocation of all the labour in Exhibit 8 to panel costs is wrong, I am also wary about the reliability of the defendant’s fairly limited allocation of labour to panel costs in Exhibit 25. There were some additional labour costs accepted by the defendant subsequently. My general preference for the reliability of bookkeeping of the plaintiff is not of assistance here, in circumstances where the basis of allocation of labour invoices between panel costs and concreting costs has been shown to be wrong. Apart from this, the defendant’s approach did not I think make sufficient allowance for the amount of work that was actually done on the panels after they were erected. Ultimately I have just allocated labour invoices as seems appropriate.
There was also one item on the defendant’s list Exhibit 25 which had not been included in the plaintiff’s list Exhibit 8: an invoice from Cutting Edge dated 15 April 2009 for $691.13, for drilling holes in the floor on 15 April. It appears in Exhibit 13, but not attributed to the panel costs. There seems to be no reason why that should not have been included. It appears to be for something involved in erecting panels, occurred just before they were erected, and seems to match Item 10 on page one of the comparison quote, Exhibit 14.
In summary therefore, for the reasons that I have given, I think the following items should be removed or reduced from the list in Exhibit 8:
1. Safetyquip $277.45
2. Royal Wolf Trading $2,352.23
3. Kennards (generator) $240
4. Kennards (concrete grinder) $88.90
5. Recycling Developments $1,573
6. Coventry Fasteners (drill) $912.77
7. CJA Excavations $2,106.50
8. CJA Excavations $176
9. Tilt Lift Equip – invoice paid twice $5,110.51
duplicate & decorative groove $504.85
10. Recycling Developments $143
11. Steellink reinforcing $330
12. Hymix $11,684.90
13. Jason Glass 23/4 $840
30/4 $896
8/5 $1,092
14. Mark Elder 30/4 $2,142
15. Scott Trenoweth 8/4 $795
16/4 $795
30/4 $1,200
16. Richard Humm 23/4 $1,020
17. Matthew Williams 8/4 $306
16/4 $333
TOTAL $34,919.11
It follows that the total for Exhibit 8 of $213,443.35 should be reduced to $178,524.24. This is a figure inclusive of GST. The relevant Panel Safe quote was $192,940 including GST, so it follows that there was a saving of $14,415.76 and the plaintiff’s entitlement of 30% comes to $4,324.72.
- Concrete work
The quote relied on by the defendant was a quote obtained by the plaintiff dated 17 January 2008 from KC Concrete Constructions, for $224,759 plus GST, which comes to $247,234.90. The plaintiff argued that this quote was too old, and would no longer have been valid, but I do not think that this matters for the purposes of the operation of the agreement between the parties. There is nothing in the terms of the contract between the parties, as set out earlier, which confines the operation of the savings clause to a situation where the comparison quote was still valid for acceptance at the time when the work was done. It would have been open to the plaintiff to obtain a more up-to-date quote, and the more up-to-date quote might have been higher or might have been lower. The general trend of building costs is higher, but at that time the costs may have gone down, or a contractor particularly keen to obtain the job might have been prepared to offer a better price. Otherwise the plaintiff, by refraining from obtaining an updated quote which was still valid at the time when the contract was entered into for whatever it was that was subject to the quote, could prevent the savings clause in the contract between the parties from coming into operation. The contract should not be interpreted that way.
The plaintiff put forward a schedule listing invoices covering the cost of the concrete work – Exhibit 10 with a total of $227,423.72 – and the defendant also put forward a schedule: Exhibit 9, with a total of $168,762.88. The plaintiff’s schedule begins with invoices dated 31 March 2009, and there are few invoices before 18 May 2009, but it is obvious from the analysis in relation to the panel costs that there was a good deal of work done prior to the erection of the tilt panels in order to create a base for such panels to be erected. There is also some difficulty in reconciling the labour costs, since some labour costs from Exhibit 8 have to be added in, and it is sometimes difficult to reconcile the labour costs in Exhibit 9 with the entries in Exhibit 10. Again, there seemed to be a lot of invoices for labour in July and August which are not included in the defendant’s list.
There were some specific issues with particular invoices, but the main issue between the parties related to the amount paid for concrete to Hymix, and the costs associated with the purchasing and laying of road base. There is also the consideration that in October 2009 there was a payment of $30,580.75 to Hymix on the basis that this represented concrete which had been supplied and had not been paid for up to that time. That would be consistent with the fact that there are a number of dates for invoices in Exhibit 34 which do not match any of the figures set out in Exhibit 10, essentially invoices for April and May. The material in Exhibit 42 does support the proposition that the various payments in Exhibit 10 were made and the invoices in June and subsequently in Exhibit 34 generally also appear in Exhibit 10. In the circumstances I accept that the defendant did make the payments for concrete listed in Exhibit 10.
In relation to the payments for “kerb” concrete on 27 June 2009, $1,290.74, (items 38 and 45), the defendant when dealing with the cost paid to GC Kerb and Channelling on an invoice dated 27 June 2009, item 44, for the construction of the kerb, said that this should not be taken into account because the construction of kerbs was not covered by the quote for the concrete work from KC Concrete Constructions: p 64. That quote refers to foundations, inside slabs and driveway slabs, but makes no reference to kerbs, and I think there is therefore substance in the defendant’s point. It follows that this invoice, and also the invoice for the concrete used in the kerb, should be deducted from the concreting costs. On the other hand, those concrete costs which were deducted from Exhibit 8 on the basis that they reflected concrete which ought to be covered by the concrete work should be added. Accordingly I find that the amount properly allowable for concrete for the concrete work is $96,993.73.[43]
[43]Total from Exhibit 10 $86,599.57 plus $11,684.90 minus $1,290.74
The defendant said that a number of the Steellink invoices in Exhibit 10 should not be included because they were concerned with excavation work excluded from the comparison quote, or with removing spoil from the site, which was also not covered by the KC Constructions quote: p 61. This seems correct, since the quote excluded bulk excavations, and hence it would not cover work related to that. Item 4 covered half of invoice 1276, which was for excavator hire for 55.5 hours: Exhibit 31. Accepting that half of this applies to excavating foundations, that still seems to me to be bulk excavation. Accordingly item 4 is disallowed. Item 5, half of invoice 1290, was said by the defendant to relate to loading spoil for removal. I accept that, so item 5 is disallowed. He also queried the Steellink payment at item 7, which covered three invoices, but one of them, for $1,210, was on his list Exhibit 9, item 6. He maintained that the rest were concerned with bulk excavation which was not covered by the quote; the invoices were not put in evidence, and I accept that the defendant was correct: p 61. I will allow in place of item 7 only the sum of $1,210. The next Steellink invoice challenged was item 12, a substantial amount for excavations, and that also looks to be related to bulk excavation, so item 12 is disallowed: p 62.
The defendant objected to the invoice from recycling developments at item 19 on the basis that this was for aggregate which was used to maintain the access roads, and was therefore a cost which would have been incurred by the plaintiff anyway: p 62. However the invoice was put in evidence as Exhibit 32, and shows that it included a charge of $600 plus GST for “20mm scalps”, which was something used under the concrete slabs, and would have been covered by the quote from the concreter. Accordingly this amount should be included in the cost, but the balance of the invoice, which was for aggregate for maintaining access, should be excluded: p 77. A similar invoice which was for scalps, Exhibit 33, was included in the defendant’s list, Exhibit 9.
Item 23 was a labour cost for Richard Humm of $1,275. The defendant said that he had a note on his time schedule that Richard was helping the carpenter that week: p 63. That document was not put in evidence, and it is not clear whether it reflects a contemporaneous note. However, there were a lot of entries for labour in Exhibit 10, and some additional labour charges have come from Exhibit 8, and the defendant did not challenge many of those in Exhibit 10, which I think lends some weight to such challenges as he did make. I therefore accept this evidence, and disallow this item. The defendant also challenged items 71 and 72, labour invoices dated 14 August; he said these people were then working on landscaping: p 66. At p 65 he appeared to accept that the last concrete was laid on or about 13 August, but that was on the basis of the last invoice from the concreter, which was dated in Exhibit 10 as 13 August. Mrs Gilbert had stated however in her evidence that that invoice was in fact received on 5 August (p 44) and in the circumstances any labour cost associated with this work, or preparing for it, should have been over before then, so I will disallow these invoices, and item 73, which is for labour for the following week. I will however allow all the other labour costs in Exhibit 10
Items 29, 35, 40, 41, 48, 51, 57 and 59 on Exhibit 10 were marked “Hanson – concrete for foundation”. The defendant maintained that what was in fact provided by Hanson was road base, and said that the provision and laying of road base under the hardstand areas was not included in the comparison quote. The quote does not say anything about the laying of compacted road base, and it speaks about “concrete works” in terms which suggest to me that it included only the laying of concrete itself, not the laying of road base under what were essentially areas outside the building, where motor vehicles would be standing or moving. There was a notation on the plans for the building that there was to be compacted subgrade under this concrete,[44] so this was certainly part of the building project. Mr Gilbert had not had previous experience of a project where compacted road base had to be placed under the concrete in a situation such as this: p 21.[45] There was no evidence to suggest that, if the comparison quote had been accepted, those concreters would have supplied and placed the road base. All I have is the terms of the quote, and in the light of the evidence before me I find on the balance of probabilities that the comparison quote did not include the supply and compaction of road base.
[44]Exhibit 15, External works plan.
[45]His original idea, that it is interchangeable with bedding sand (p 74), was unsupported by suitable evidence, and strikes me as incorrect.
It follows that the invoices in Exhibit 10 relating to that should not be included. None of the Hanson invoices was produced, nor was there any other evidence produced that during this period that both Hymix and Hanson were providing concrete, and on the whole I think that is unlikely, particularly bearing in mind the large amount payable to Hymix for concrete anyway. In the light of all of the evidence, I accept the defendant’s evidence that the Hanson invoices related to the provision of road base, so all of them should come out of Exhibit 10. The defendant said that he also had a compacting roller on the site which was used to compact the road base: day 3 p 21. The invoice for this does not appear to be included in Exhibit 10, otherwise I would also deduct that.
The next item in Exhibit 10 disputed by the defendant was item 36. The defendant said that he suspected that this related to loading spoil for removal: p 64, where he did not seem to be very certain about this. It occurs to me that there would have been some excavation associated with the hardstand areas, because there had to be material removed for the road base to be placed, and presumably the road base had to be properly spread over the area after it was delivered by Hanson. There was however no evidence of this. I am doubtful about this invoice, but on the whole I do not think there is a proper basis on the evidence for me to exclude it.
The defendant disputed item 44, the cost of kerb construction, on the basis that this was not included in the quote. I have already said something about this in relation to the concrete, and for the same reason this item should come out as well: p 64.
Item 61 was for a five-tonne combo hire on 14-16 July 2009: p 50. That sounds to be the sort of equipment which would be involved in bulk excavation rather than the sort of detailed excavation which was covered by the comparison quote, so I will disallow item 61.
Apart from the concrete cost attributed to panel construction which ought to have been attributed to concreting, there was also some labour cost taken off the cost of the panels on the basis that it related to concreting, and this labour, which was not included in Exhibit 10, should be added in. These are the labour charges referred to items 13 – 17 in paragraph [58], which total $9,419. There were also some items on the defendant’s list which had not been included in the plaintiff’s list: one of these is an invoice from Steellink Reinforcing Pty Ltd dated 12 May 2009 for $945.01. There seems to be no reason why that should not have been included; it appears to be for the purchase of reinforcing, similar to that included in the invoice from Steellink which is item 6 in Exhibit 10: Exhibit 12.
The defendant had as item 18 on Exhibit 9 an invoice to Powercrete, the concrete pumping company, for $1821.05. It was only concrete used for the concreting works, not the panel work construction, which was pumped,[46] so if there was a charge from Powercrete in that amount it ought to be on the list. There is no matching invoice from Powercrete in Exhibit 12, but there is such an invoice included in the plaintiff’s list of all of the payments made in respect of the project, Exhibit 13, though it is not there attributed to foundations and hardstand. The onus of showing that there was an offsetting saving in respect of the concrete work is on the defendant, and it follows from this that the defendant’s inclusion of this invoice in the concreting costs should stand, so it should be added to the total in Exhibit 10.
[46]Williams p 3.
The defendant also included an invoice from CJA Excavations for $418 dated 3 July 2009, which Mrs Gilbert said the plaintiff had received but had not included in this work: p 53. It was for the hire of a positrack which is something used to level off the surface to get it ready for the concrete: p 50. In those circumstances it sounds like something which should have been included in the costs of the concreting work, and this invoice should be included. The same applies to an invoice dated 11 June 2009 for $418: Exhibit 12.
The defendant had put part of the invoice which is item 36 on his schedule, limited to the total amount charged for the hire of the positrack on 25 and 26 June, plus GST, $1,619.75. Most of the rest of this invoice related to a 20 tonne excavator hire, which sounds like something involved in bulk excavations, float fees, and bobcat hire. The bobcat charges are by their nature ambiguous: they might or might not be for things which would have been done by the concreter who provided the comparison quote, but there is no good reason to reject the defendant’s evidence. The timing coincides with that of the largest invoice for road base, which no doubt needed spreading. I will allow only $1,619.25 for item 36.
Overall therefore the total in Exhibit 10 needs to be adjusted by adding the following items:
(a) Concrete from Exhibit 8 $11,684.90
(b) Labour from Exhibit 8 $9,419.00
(c) Steellink – reinforcing 12/5/09 $945.01
(d) Powercrete – pumping $1,821.05
(e) CJA Excavations 11/6/09 $418
3/7/09 $418
Subtotal $24,705.96
As well, the following items are to be removed, in whole or in part:
(f) Concrete for kerbs $1,290.74
(g) Steellink- Item 4 $3,052.50
- Item 5 $330.00
- Item 7 (part) $4,133.00
- Item 12 $3,355.00
- Item 19 (part) $660.00
(h) Hanson – road base $17,848.22
(i) Kerb construction – Item 44 $2,750.10
(j) CJA Excavation - Item 36 (part) $3,844.50
- Item 61 $2,666.50
(k) Labour - Item 23 $1,275.00
- Item 71 $1,120.00
- Item 72 $306.00
- Item 73 $1,120.00
Subtotal $43,751.56
The calculation is therefore:
Total from Exhibit 10 $227,423.72
Plus additions $24,705.96
Less reductions $43,751.56
Concrete work costs $208,378.22
Saving from quote of $247,234.90 $38,856.68
30% share $11,657.00
- Landscaping
The Plaintiff, in a document filed on 23 July 2012 in response to the defendant’s document setting out his claims, said that it accepted the defendant’s calculations in relation to landscaping, and that there was a saving of $14,500 over a relevant comparison quote as a result of the defendant’s doing the work It was conceded that as a result the defendant was entitled to 30% of that, which is $4,350.
Extra work
It was common ground that there was some extra work, in that some of the internal fit out was different from what was shown on the plans, particularly in relation to the mezzanine flooring.[47] There was some dispute about the scope of this, but the plaintiff’s position was that there was never any specific agreement in relation to the extra work, and the contract Exhibit 3 on its face was apt to cover the extra work, so the defendant was remunerated with respect of the extra work by the formula under the contract, relevantly by five per cent of the total cost of the works.[48] It is difficult to see why that proposition is not correct.
[47]Gilbert p 78-9; Williams p 33. The defendant’s list of the extra work he did was Exhibit 24.
[48]Gilbert p 78, 82.
The defendant was not able to establish that there was any specific agreement between the parties as to how the defendant would be paid in relation to any extra work, in the sense of work which had to be done over and above the work included in the original plans, or different from that work: p 66. The cost of doing any such extra work was passed onto the plaintiff in the same way as all other costs of work on the site were passed onto the plaintiff, and paid by it. In these circumstances, it is not the case that the defendant himself did the work as some kind of subcontractor, and therefore has a claim in quantum meruit against the plaintiff in respect of that work. What has happened in practice is that the mechanism in the contract between the parties was applied in relation to any extra work.
In those circumstances, bearing in mind that there is nothing in the terms of Exhibit 3 which would exclude its operation in respect of any extra work in connection with the project, the plaintiff’s argument is correct and the contract Exhibit 3 applied to any extra work or work done as a result of changes to what was required, in the same way as any other work. It follows that the defendant is not entitled to any special remuneration in respect of any extra work done by him, and this part of the defendant’s claim fails. In these circumstances it is not necessary for me to embark on the process of assessing a value in respect of that extra work, something which would on the evidence at the trial be very difficult anyway, because the defendant lead no evidence of the value of the extra work, or any evidentiary foundation for a claim for reasonable remuneration in respect of it. Indeed, there was not even any clear evidence form the defendant as to the scope or value of the extra work, merely a global assertion by the defendant that in respect of extra work he was entitled to reasonable remuneration of $16,000, calculated as eight weeks salary at $2,000 per week. In these circumstances, I do not think I can make any meaningful findings on a precautionary basis.
Conclusion
It follows that the defendant was entitled under the contract to receive the following amounts:
(a) 5% of the total project costs $69,499.99
(b) 30% of saving on panel works $4,324.72
(c) 30% of saving on concreting works $11,657.00
(d) 30% of saving on landscaping (agreed) $4,354.00
(e) 30% of saving on structural steel quote $231.00
Subtotal $90,066.71
The defendant had received the following payments:
(a) Payments during the contract (Exhibit 13) $67,000
(b) Payments under adjudication $127,313.50
Subtotal $194,313.50
Balance - overpayment $104,246.79
It follows that the plaintiff is entitled to recover $104,246.79 from the defendant, on the basis that this money was overpaid as a result of the order made by the adjudicator. It was common ground that that payment was made, but there was no evidence as to the date of that payment; in these circumstances I will allow interest under the Civil Proceedings Act 2011 s 58 from the commencement of the proceeding to the date of judgment, 2.7 years. This is a commercial matter, but interest rates have declined significantly in recent years. There was no evidence as to the actual cost to the plaintiff of being kept out of this money. In all the circumstances I will allow interest at 7%, a total of $19,702.64. There will therefore be judgment that the defendant pay the plaintiff $123,949.43, including interest of $19,702.64. I will invite submissions in relation to costs at the time when these reasons are published.
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